Opening a fuel pump station requires planning and may be more difficult than you think. However, it can be done once you understand the basics of gasoline service, have a solid business plan, and take advantage of financing and loan options. You also need to know how to price. Use a gas price comparison app to learn the lowest gas rates in your area.
Let’s start with some basic Gas Prices 101 to introduce you to the world of fuel pump station prices. Finding the lowest gas prices is not easy and requires the best suppliers. Knowledge of tax laws is also important here because they may affect the cost of your fuel, particularly if it is unbranded fuel.
But what’s the difference between branded and unbranded fuel, and does it matter? Some benefits of unbranded fuel are the ability to sell your gas at lower prices, freedom to choose/change suppliers, and having additive-free fuel. However, branded gas also has its benefits, including a recognizable brand name that may appeal more to consumers. The decision to sell branded or unbranded fuel is an important consideration when you are looking to open a fuel pump station.
If you are thinking about opening a new gas station or taking an existing one over, you are in good company. This can be a business that provides great opportunities for a steady income.
When you want to open a gas station, it’s important that you have a good business plan written up. There are so many different aspects that go into running a business like this. For starters, it’s crucial that you always keep your fuel options in mind. Unbranded gas prices may also be different from one state to another as a result of tax laws. Opening a gas station, much like running any other kind of business, will require capital upfront and vendors to supply you. One of the most important vendors to look for is a gas supplier. Once you’ve written up your business plan, you can start looking at things of this nature.
But that’s not all it takes to open a gas station as a business. From getting gas station financing to keeping yours up and running, here are some tips to help make your experience go better.
Be prepared for challenges with your gas station financing. There are a few kinds of businesses that are problematic when it comes to getting financing. Gas stations, convenience stores, and truck stops are all lumped together when it comes to getting financing. You may not realize how challenging it can be to get gas station financing until you try but it is. A lot of this is because this is a cash business and has different challenges and is looked at differently than other kinds of commercial financing. Do not be shocked if your bank turns you down. You can also talk to local community banks and to the credit union. Do not despair, it is possible to get gas station financing but if you go into the process knowing it will be challenging, you will find the process easier. If you own property, you might want to look into a secured loan.
Go to the government. Look for Small Business Administration loans (SBA). The SBA has a lot of help to offer. In the first place, there are 504 SBA loans. The SBA works with what are called Certified Development Companies (CDC) to offer loans to businesses that are going to offer something that is needed in the community. That could very well be a gas station. The SBA has a number of programs that are there to help small business owners like yourself. They may be able to help you secure your gas station financing.
As in all real estate, it is all location, location, location. Perhaps more than any other business, where you put your gas station is a big deal. People may take a longer drive to that antique store or fun restaurant but they are not going to drive to an out of the way space for gas. The two things people look for when they are deciding what gas station to go to are location and price. People may even pay a little more if the space is more convenient. This is why sometimes the gas stations right by the highway may be more expensive than the ones a few blocks away. Another good place to be is near hotels.
Be careful about security. If you go into this business, you need to get the right number of security cameras. This is not optional. Gas stations are often targets for crime and theft. This is one of the reasons gas station financing can be challenging to get. Keep your investment safe and your employees and customers safe by having the right security in place.
Learn the business. This should be a given for all businesses but you need to really get to know the ins and the outs of running a gas station. Know what you are getting yourself into when you open or take over a gas station. For example, if you go in thinking you are going to make your money from gas sales, you will be disappointed.
Lure people in and keep them coming back. The margin for gas sales is so small that you have to understand that this is not where you are going to make your money. Most gas stations make their money inside the store or with an attached business such as a restaurant. Your profits will come from the items you sell. All businesses that sell food need to make sure that it is fresh but if you sell milk at your gas station and it is bad when your customer buys it, you will lose that customer. If people go to use your restroom and it is filthy, they will not come back. You have to make people see the value in shopping at your store when they are getting their gas.
It is very possible to make money running a gas station but it might not be the way you think.